Is ALPS Equal Sector Weight ETF (EQL) a Strong ETF Right Now?

The ALPS Equal Sector Weight ETF (EQL) made its debut on 07/07/2009, and is a smart beta exchange traded fund that provides broad exposure to the Style Box - Large Cap Blend category of the market.

What Are Smart Beta ETFs?

Market cap weighted indexes were created to reflect the market, or a specific segment of the market, and the ETF industry has traditionally been dominated by products based on this strategy.

Market cap weighted indexes offer a low-cost, convenient, and transparent way of replicating market returns, and are a good option for investors who believe in market efficiency.

But, there are some investors who would rather invest in smart beta funds; these funds track non-cap weighted strategies, and are a strong option for those who prefer choosing great stocks in order to beat the market.

Based on specific fundamental characteristics, or a combination of such, these indexes attempt to pick stocks that have a better chance of risk-return performance.

While this space offers a number of choices to investors, including simplest equal-weighting, fundamental weighting and volatility/momentum based weighting methodologies, not all these strategies have been able to deliver superior results.

Fund Sponsor & Index

The fund is managed by Alps, and has been able to amass over $588.57 million, which makes it one of the average sized ETFs in the Style Box - Large Cap Blend. Before fees and expenses, EQL seeks to match the performance of the NYSE Select Sector Equal Weight Index.

The NYSE Equal Sector Weight Index comprises of all active Select Sector SPDR ETFs in an equal weighted portfolio. These sector includes Consumer Discretionary, Consumer Staples, Materials, Energy, Technology, Utilities, Financial, Industrial, Health Care & Real Estate.

Cost & Other Expenses

Investors should also pay attention to an ETF's expense ratio. Lower cost products will produce better results than those with a higher cost, assuming all other metrics remain the same.

Annual operating expenses for this ETF are 0.27%, making it on par with most peer products in the space.

It has a 12-month trailing dividend yield of 1.70%.

Sector Exposure and Top Holdings

Most ETFs are very transparent products, and disclose their holdings on a daily basis. ETFs also offer diversified exposure, which minimizes single stock risk, though it's still important for investors to research a fund's holdings.

Taking into account individual holdings, State Street Health Care Select Sector Spdr Etf (XLV) accounts for about 10.07% of the fund's total assets, followed by State Street Technology Select Sector Spdr Etf (XLK) and State Street Energy Select Sector Spdr Etf (XLE).

EQL's top 10 holdings account for about 91.3% of its total assets under management.

Performance and Risk

Year-to-date, the ALPS Equal Sector Weight ETF has added roughly 1.32% so far, and was up about 13.73% over the last 12 months (as of 01/06/2026). EQL has traded between $37.36 $46.99 in this past 52-week period.

The fund has a beta of 0.90 and standard deviation of 12.63% for the trailing three-year period, which makes EQL a medium risk choice in this particular space. With about 12 holdings, it has more concentrated exposure than peers .

Alternatives

ALPS Equal Sector Weight ETF is an excellent option for investors seeking to outperform the Style Box - Large Cap Blend segment of the market. There are other ETFs in the space which investors could consider as well.

iShares Core S&P 500 ETF (IVV) tracks S&P 500 Index and the Vanguard S&P 500 ETF (VOO) tracks S&P 500 Index. iShares Core S&P 500 ETF has $767.3 billion in assets, Vanguard S&P 500 ETF has $829.08 billion. IVV has an expense ratio of 0.03% and VOO changes 0.03%.

Investors looking for cheaper and lower-risk options should consider traditional market cap weighted ETFs that aim to match the returns of the Style Box - Large Cap Blend

Bottom Line

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This article originally published on Zacks Investment Research (zacks.com).

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